CDY Casdon

RNS No 6673u
CASSIDY BROTHERS PLC
6th February 1998


Interim Results to 31 October 1997

Chairmans Statement 
Shareholders will, no doubt share my disappointment in the interim results but
the Company remains in a sound financial footing and an interim dividend will
be paid and your Chairman feels sure you will understand when the explanations
are duly given.

Our experience, as echoed previously by other reporting companies, was that
retail sales in the approach to Christmas were initially slow. Retailers
extreme caution to avoid overstocking meant that the tendency to order late
continued. These trends filtered through to most manufacturers and importers.
Cassidy Brothers were not exempt from these difficulties, but as soon as we
could be confident about Christmas sales, temporary staff were recruited to
boost our production levels. We were buffeted from the worst market effects by
the consistent sales of our nursery goods, which provide year-round revenue.

The finished stock that we bring in from China is governed by the prevailing
EC quota and licensing system, limiting the volume of goods in certain
classifications that can be imported. Numerous consultations with HM Customs &
Excise, coupled with forward  administrative planning, have assured us that we
will be able to work within the current legislational procedures and that we
will be able to adapt to any changes in the EC system.

The manufacture of selected Casdon goods overseas, initiated twelve months
ago, enabled us to supply items with a high labour content at attractive
prices and thus brought positive results. The programme was slightly disrupted
by late but necessary amendments to specifications and by revised sourcing in
the countries if manufacture to ensure production standards. Consequently,
supplies started later than intended and a number of consignments had to be
flown rather than shipped in, but all items were on stream by the end of
October and were of a quality befitting Casdons high reputation within the
trade.

In the last Annual report I detailed the limited redundancy programme
undertaken in late 1996, coupled with changes to the Companys policy in
sourcing injection moulding tools. As a consequence of these actions, internal
manufacturing costs within certain departments and the capital costs of
tooling fell significantly in 1997. Although profitability improved due to
lower tooling amortisation charges, this will not take full effect until the
1999/2000 financial year. However, I am pleased to report that the benefits to
cash flow are already in evidence and have contributed positively to ensuring
that the Companys underlying financial position remains strong. 

Interim Dividend
The directors are pleased to maintain the usual dividend of 0.75 pence per
share, payable on 6 April 1998, to the ordinary shareholders on the register
at the close of business on 20 February 1998. The Shares are expected to be
traded ex dividend on 16 February 1998.Bearing in mind the numerous
difficulties previously explained, we are proud to achieve this for the
seventh year.

Current Trading
Demand for Casdon products continued throughout November and December,
although total turnover was marginally lower than the corresponding months in
1996, as an air of caution prevailed over the retail trade.

In early November we suffered a warehouse fire. The comprehensive sprinkler
system proved its efficiency by keeping the fire under control, nonetheless we
were fortunate that minimal amounts of stock were stored in the area
concerned. The total loss was covered in full by the Companys insurances, and
no adjustments to the interim results were required.

Future Prospects
During the last twelve months we have undertaken some fundamental policy
changes whilst remaining aware of the other needs of the business. The toy
trade is product-driven, and new developments are sought every year. The new
items that we have developed for 1998 embrace household names and probably the
leading brand of character merchandising in the UK today. Shareholders will
perhaps excuse their Board of Directors for their keen sense of anticipation
as the major toy fairs come around each year, but we are genuinely inspired by
the prospects for and the reaction to 1998s new items due to their
exceptionally high profile.

The first toy fair was held in Harrogate between 10/14 January. The five new
items were each regarded as future winners in their field, with a toy Dyson
Vacuum Cleaner a predictable toy top seller, followed by an original designed
service station incorporating the Shell logo, with working digital display and
sound system. The toy Flymo Turbo mower incorporates many original Casdon
features.

In the past, Cassidy Brothers have approached the area of character
merchandising with due caution because of the transient popularity that such
goods often experience. Having said that, we regard the prospects of two
Teletubbies items new for 1998, namely a Patio Set and Electronic Activity
Centre, very positively due to the enormous success of the TV programme. The
enduring nature of many of the BBCs childrens series over the years also gives
us confidence that these new items will be valuable revenue earners for a
number of years.

Whilst the prospects for our new developments appear stimulating they are very
unlikely to have any material impact on the results for the second half of the
current financial year. Although improvements in turnover and profits in
1998/99 are highly likely, it will not be practical to assess the precise
impact  of the new items for three or four months, when the major UK toy
buyers will have completed their selection and forecasting processes. I look
forward to being able to update shareholders with a healthy measure of
positive and current news in the Annual Report in late June.

On a personal note your Chairman was awarded the MBE in the New Years Honours
List and this obviously is most gratifying and received with due grace and
pleasure.


Thomas D Cassidy
Chairman


INTERIM RESULTS (UNAUDITED)

                 Six months ended       Six months ended       12 months ended
                  31 October 1997        31 October 1996         30 April 1997
                                #                      #                     #
                     
Turnover                3,582,547              4,031,220             6,316,290
Profit on ordinary                     
activities before 
taxation                  167,684                354,064                50,721
                     
Taxation                  (20,250)               (95,600)              (3,301)
                     
Profit attributable to                             
shareholders              147,434                258,464                47,420
                     
Dividends (see below)     (41,433)               (41,433)            (165,731)
                     
Retained profit/(loss)    106,001                217,031             (118,311)
                     
Dividends are as follows:                     
Interim dividend of 0.75p 
per share proposed at 31 
October, paid at 30 April) 41,433                 41,433                41,433
                     
Final dividend of 2.25p 
per share                       -                      -               124,298
                     
                           41,433                 41,433               165,731
                     
Earnings per share           2.67p                  4.71p                0.86p


SUMMARISED BALANCE SHEETS

                  As at 31 October       As at 31 October       As at 30 April
                              1997                   1996                 1997
                                 #                      #                    #
                     
Fixed assets             2,254,943              2,515,045            2,372,296
                     
Current assets           4,160,504              4,184,785            3,077,898
Creditors: amounts 
falling due within 
one year                (2,127,390)            (2,079,800)         (1,243,871)
Net current assets       2,033,114              2,104,985           1,834,027
                     
Total assets less 
current liabilities      4,288,057              4,620,030           4,206,323
                     
Deferred liabilities 
and provisions            (181,581)             (215,613)            (205,848)
                     
Net assets employed       4,106,476            4,404,417            4,000,475
                     
Share capital               552,435              552,435              552,435
Reserves                  3,554,041            3,851,982            3,448,040
                     
Shareholders funds        4,106,476            4,404,417            4,000,475

Notes:

The results for the half year ended 31 October 1997, which have been prepared
in accordance with the accounting policies adopted in the financial statements
for the year ended 30 April 1997, are unaudited and do not constitute
statutory accounts as defined in S 240 of the Companies Act 1985.

The financial information for the year ended 30 April 1997 is an abridged
version of the full accounts for that year, which have received an unqualified
audit report and have been filed with the Registrar of Companies.

Taxation for the six months ended 31 October 1997 has been based on the
estimated effective tax rate for the full year.


Copies of this announcement are available from today for a period of 14 days
from Charles Stanley & Company Limited, 25 Luke Street, London EC2A 4AR.

END

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